Tips for Surviving an Economic Meltdown

The world’s economic meltdown was a rude awakening, particularly as it relates to sound financial and business practices. The impact hit close to home for many companies and some have been completely devastated. The recent bankruptcy of General Motors and Chrysler shows how unhealthy business practices such as overspending, overproducing, and the loss of market focus can destroy even companies thought to be “too big to fail.”

In retrospect, one thing is certain: Companies that implement a few basic business principles and adhere to them over time improve their odds of success in the face of a market collapse. Here are some guidelines which have proven successful for Lauren International in both expanding and contracting markets.

Be prepared. Top leaders and managers must engage in open discussions and plan for various scenarios that may impact the business. Maintain contingency plans that accommodate both aggressive growth that far exceeds company expectations as well as an extremely conservative approach should the market contract. It is crucial to balance the company’s response to falling demand by retaining enough flexibility and capacity to handle future growth. Preestablished metrics let business leaders monitor production and profitability and respond decisively based on market conditions.

Innovate. Look for new, innovative products and services that can quickly boost current business. And continue to invest in research and development and manufacturing operations for profitable, long-term product additions. This lets firms capitalize on viable opportunities during downturns while planning for future expansion when conditions improve. Companies that fail to continually invest in R&D often find few options and little support when their markets soften.

Connect to your markets. Business leaders must understand the markets they serve. While this seems cliché, leaders who don’t have a finger on the pulse of the industry are easily blindsided. One way is to continually monitor the competitive landscape, in-part, through continual feedback from sales and marketing teams as well as daily communications with customers. Trade shows and industry associated meetings also provide tremendous insight into market trends. Being involved in your markets is critical.

Stay close to customers. Continually reevaluate how you serve your clients and make adjustments as needed. Partner with customer engineers, purchasers, and top management by developing value-added solutions for their needs. Always strive to exceed their expectations at every level, visit their facilities whenever possible, and ask strategic questions that help you become a better business partner.

Explore new markets. A status-quo approach to business in today’s constantly changing marketplace is not an option. Look for growth by creating entirely new market opportunities. For instance, we’ve successfully expanded from our traditional industrial base into solar and wind power, health and wellness pet products, and first-response and disaster-planning software, to name a few. In short, identify customer needs and pair those with your company’s technical ingenuity and manufacturing expertise, as well as the best creative marketing and sales minds.